MICRON TECHNOLOGY: $3.4

Billion deal for Hynix means a new chip leader

April 23, 2002|By From Tribune news services.

BOISE, Idaho — After months of negotiations, Micron Technology Inc. on Monday agreed to buy most of the assets of South Korea's Hynix Semiconductor Inc. for $3.4 billion, making the U.S. chipmaker the biggest maker of memory semiconductors used in personal computers.

If the deal goes through, and analysts expect it will, Micron would have about 40 percent of the market and would leapfrog South Korea's Samsung Electronics to become the world's largest memory chipmaker.

Micron agreed to pay 108.6 million of its shares for Hynix's memory-chip manufacturing operation and will pay $200 million in cash to buy a 15 percent stake in the company's non-memory-chip operation. As part of the deal, Korean lenders will provide Micron $1.5 billion in long-term debt financing for Korean-based operations.

Creditors expected a final deal to price Micron shares at $35 apiece, raising the value of the takeover to $4 billion, said Lee Duk-hoon, chief executive at key creditor Hanvit Bank. Micron stock closed Monday at $30.90, up $1.40, or nearly 5 percent, on the New York Stock Exchange.

The deal gives the two companies and Hynix's creditors until April 30 to complete the deal.

Hours after the agreement was announced, Micron said it would also purchase the Virginia-based computer memory business of Japan's Toshiba Corp. for about $295 million in cash and stocks.